Nevermind! It seems it doesn't work on anything in a grav well that is suddenly unowned (or always unowned, haven't tested THAT far).
For instance, im fighting an AI player. I'm sieging his planets just to get him out of there, and hiding from his starbase/tactical structure mass on the other side of the planet. Before planet is lost, it works just fine on all ships/buildings. BUT as soon as i finish bombing the planet to neutrality, the ability no longer affects anything at all, not even friendly ships.